Bankruptcy Law

Any substitution of a transferee must be authorized by the court in the judgment adopting the sale plan, in accordance with Article L. 642-9(3) of the Commercial Code. In many cases, the offer is made by a natural person on behalf of a legal entity in the process of being set up, or yet to be set up. When authorization for the sale of a production unit is granted to named individuals or, failing t …

Court authorization for substitution

Any substitution of a transferee must be authorized by the court in the judgment adopting the sale plan, in accordance with Article L. 642-9(3) of the Commercial Code. In many cases, the offer is made by a natural person on behalf of a legal entity in the process of being set up, or yet to be set up. When authorization for the sale of a production unit is granted to named individuals or, failing this, to “any natural or legal person who may be substituted”, the right of substitution may only be exercised by the liquidator, in the event that the designated transferees do not follow through with their offer, without the rules of contractual subrogation being applicable .

Authorization can only be granted if the initial transferee guarantees the commitments it has entered into in the plan . However, case law limits the scope of this undertaking to the content of the takeover offer, and does not consider the purchaser to be guarantor of the proper performance by the substitute assignee of the obligations arising from the assigned contracts, with regard to the other contracting parties , unless he undertakes to the contrary with regard to the creditor . In particular, while the initial purchaser remains jointly and severally liable for the performance of the commitments it has entered into, in particular those concerning the resumption of employment, it does not guarantee that these will be maintained by the transferee . Nor does it automatically guarantee the transferee's obligation to pay the loan installments .

In the absence of an undertaking to the contrary by the original assignee, the substitute assignee is bound to perform the commitments arising from the contracts transferred under the plan, even if its identity is not mentioned in the judgment approving the sale plan . Similarly, the lessor cannot take action against the offeror for payment of sums due under the transferred contracts, since this obligation falls to the substitute assignee .

Lastly, Article L. 642-9(4) stipulates that any substitution of assignee not authorized by the court is null and void at the request of any interested party or the public prosecutor.

Cass. com., 19 October 1993, LawLex202100005136JBJ (LJ).

Cass. com., 12 July 2016, LawLex202100001190JBJ (RJ).

See, on the principle, Cass. com. 7 October 2020, LawLex202200007455JBJ (LJ). See, in the presence of a clause to the contrary, Cass. com. 20 September 2017, LawLex202100003303JBJ (RJ).

Cass. com., 2 February 2022, LawLex202200001596JBJ (RJ).

Cass. com., 30 January 2019, LawLex202100001192JBJ (LJ).

Cass. com., 27 September 2011, LawLex202100001189JBJ (RJ).

Bankruptcy Law

881. Court authorization for substitution

Demandez un accès gratuit
au contenu exclusif Livv – juristes d’entreprise

Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

881. Court authorization for substitution

Demandez un accès gratuit au contenu exclusif Livv – juristes d’entreprise

Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

Demandez un accès gratuit
au contenu exclusif Livv – juristes d’entreprise